Legislative Updates

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In response to the failure of Proposition HH at the November 7, 2023 election, Governor Polis called the First Extraordinary Session of the 74th General Assembly which convened on November 17, 2023 and concluded on November 20, 2023.  Below is a summary of legislation impacting special districts passed during the special session. For a full text of the legislation, click the title below to link to the Colorado General Assembly website.

SB23B-001: 2023 Property Tax Relief

Summary:

Changes in Valuation Assessment:  The law makes temporary reductions in the assessment rate for multi-family residential real property and all other residential real property. For the 2023 property tax year, the assessment rate for both multi-family and all other residential real property will be reduced from 6.765% to 6.7% of the amount equal to the actual value minus the lesser of $50,000 or the amount that causes the valuation to be $1,000.

Reimbursements. The State is currently required to reimburse local governmental entities for property tax revenue lost because of the reductions in valuation enacted in Senate Bill 22-238. The law maintains this backfill mechanism and provides an additional backfill mechanism to reimburse local governmental entities for property tax revenue lost because of the additional reductions in valuation enacted in the law. The State will reimburse the following local governmental entities a total of $65,000,000 for the total amount of property tax revenue lost by those local governmental entities because of the reductions in valuation in the law in the same manner as provided in Senate Bill 22-238, except that:

  • Fire districts, heath districts, and ambulance districts, are reimbursed entirely; and

  • Local governmental entities for which the assessed value of property in the local governmental entity increased by 15% or more between the 2022 and 2023 property tax years are not reimbursed at all, while local governmental entities with less than 15% increase in assessed value may be eligible for reimbursement.

The law also modifies both the existing backfill mechanism for Senate Bill 22-238 property tax revenue reductions and the backfill mechanism for the law’s property tax revenue reductions by:

  • Specifying that the amount of revenue lost for a property tax year is based on a local governmental entity’s mill levy for the 2022 property tax year, excluding specified mills;

  • Clarifying how local governmental entities, which are defined in the law, are treated if their boundaries are in more than one county for purposes of the backfill; and

  • Requiring the state treasurer to reduce a backfill as necessary to prevent a local governmental entity from exceeding its constitutional fiscal year spending limit.

The law requires the State treasurer to transfer $135 million from the general fund to the State education fund to offset school district property tax revenue reductions.

Delayed Deadlines.  Finally, the Law implements delays in deadlines as necessary due to the valuation changes for the 2023 property tax year and makes conforming amendments related to the valuation changes.  The following delays are implemented:

  • The deadline for assessors to certify final assessed valuation to local governments is changed from December 10, 2023 to January 3, 2024.

  • The deadline for local governments to certify mill levies is changed from December 15, 2023 to January 10, 2024.

  • The deadline to adopt a budget is changed to January 10, 2024.

  • The deadline to file final budgets is not changed.

The law was signed by the Governor on November 20, 2023, and became effective immediately.

We have been advised that some counties are already hard at work to make the required adjustments and intend to certify final assessed valuations to local governments before the new deadlines listed above.  We will continue to work with accountants to make necessary adjustments and to finalize budgets which have already been adopted.

If you have specific questions about how this new law impacts your district, please reach out directly to the responsible attorney.

This year’s Legislative Session officially wrapped up on May 8, 2023. As in past years, we are providing a summary of the pertinent legislation impacting special districts and community associations. Each law listed below is linked to the Colorado General Assembly website and can be accessed by clicking the individual bill titles. Updated information related to laws that have not been signed as of the date of this memorandum or which do not officially become effective until after the referendum period runs will be provided on our website at www.whitebearankele.com. If you would like more detailed information on any of the information contained herein or on bills that were introduced but not passed, please let us know.

Special District Legislation

View the text of HB23-1023

The law increases the requirement to publicly bid contracts for construction, materials, or both from $60,000 to $120,000 or more, and requires the amount to be adjusted for inflation every five years.

The law was signed by the Governor on March 17, 2023, and takes effect 90 days after the end of the legislative session, August 7, 2023, unless a referendum is filed.  If a referendum is filed, then it will be on the November, 2024 ballot.

View the text of HB23-1062

The law allows a metropolitan district that is not located in an incorporated municipality to levy a sales tax to provide parks or recreational facilities or programs within the district in which the tax is levied.

The law was signed by the Governor on April 17, 2023, and takes effect 90 days after the end of the legislative session, August 7, 2023, unless a referendum is filed.  If a referendum is filed, then it will be on the November, 2024 ballot.

View the text of HB23-1105

The law creates the HOA homeowners’ rights task force (HOA task force) and the metropolitan district homeowners’ rights task force (metro district task force) in the division of housing (division) in the department of local affairs.

Members of the metro district task force must be designated or appointed on or before November 1, 2023. The metro district task force is required to:

      •  Study issues confronting metropolitan district homeowners’ rights, including metropolitan district boards’ tax levying authority and practices, foreclosure practices, communications with homeowners, and governance policies; and

      •  Prepare a report regarding its findings and conclusions, publish the report on the division’s website, and submit copies of the report to the legislative committees and the governor on or before June 15, 2024.

The law was signed by the Governor on May 25, 2023 and takes effect immediately.

See below for description of HOA task force specific details.

View the text of HB23-1259

The law creates a right for a local public body to cure a violation of the open meetings law with respect to an executive session if the local public body takes the corrective action at its next meeting after the meeting at which the violation occurred or at the local public body’s next meeting that is held at least 14 days after receiving notice by a person who intends to challenge the violation. The law also addresses standing to challenge a violation of the open meetings law, and the payment of attorney fees. If a local public body in connection with an executive session commits a third violation of the same nature within a one-year period, the local public does not have a right to cure the violation.

The law was vetoed by the Governor on June 6, 2023.

View the text of SB23-108

The law allows a local government to provide temporary property tax relief through temporary property tax credits or mill levy reductions and later eliminate the credits or restore the mill levy. A temporary reduction in property taxes must be annually renewed by the local government.

The law was signed by the Governor on June 5, 2023, and takes effect 90 days after the end of the legislative session, August 7, 2023, unless a referendum is filed. If a referendum is filed, then it will be on the November 2024 ballot.

View the text of SB23-110

This law has four main sections to increase transparency for metropolitan districts.

      •  For a proposed metropolitan district that submits a service plan on or after January 1, 2024, the law requires the service plan to include a cap on the maximum mill levy and a cap on the maximum debt that may be issued by the metropolitan district.

      •  Beginning in the 2023 calendar year, the law requires the board of a metropolitan district to hold an annual “town hall” meeting if the metropolitan district was organized after January 1, 2000, has residential units within its boundaries, and is not on inactive status. This meeting is an opportunity for members of the public to ask questions about the metropolitan district. No formal action may be taken at the meeting and must ensure that the annual meeting includes a presentation from the metropolitan district regarding the status of public infrastructure projects within the metropolitan district and outstanding bonds, if any, a review of unaudited financial statements showing the year-to-date revenue and expenditures of the metropolitan district in relation to its adopted budget for that calendar year.  Further, metropolitan districts will be required to include a public comment period at their budget hearing meeting to provide further opportunity for the public to provide formal, public comment.

      •  The law specifies that prior to issuing debt to a director of a metropolitan district or to an entity with respect to which a director of a metropolitan district must make a disclosure pursuant to current law, the board is required to receive a statement of a registered municipal advisor certifying specified criteria regarding the interest rate of the debt.

      •   The law requires the seller of residential real property that is located within a metropolitan district organized after January 1, 2000 to provide the purchaser of the property with the official website established by the metropolitan district. The seller is required to provide the information on the Colorado real estate commission approved seller’s property disclosure.

The law was signed by the Governor on April 3, 2023, and takes effect 90 days after the end of the legislative session, August 7, 2023, unless a referendum is filed.  If a referendum is filed, then it will be on the November, 2024 ballot.

View the text of SB23-111

The law grants certain public employees, including individuals employed by various entities including special districts the right to:

      •  Discuss or express views regarding public employee representation or workplace issues;

      •  Engage in protected, concerted activity for the purpose of mutual aid or protection;

      •  Fully participate in the political process while off duty and not in uniform, including speaking with members of the public employer’s governing body on terms and conditions of employment and any matter of public concern and engaging in other political activities in the same manner as other citizens of Colorado without discrimination, intimidation, or retaliation; and

      •  Organize, form, join, or assist an employee organization or refrain from organizing, forming, joining, or assisting an employee organization.

The law also prohibits certain public employers from discriminating against, coercing, intimidating, interfering with, or imposing reprisals against a public employee for engaging in any of the rights granted.

The Colorado department of labor and employment (Department) is charged with enforcing any alleged violation of these rights and is granted rule-making authority. A party may appeal the Department’s final decision to the Colorado court of appeals. The law requires the court of appeals to give deference to the department.

The law was sent to the Governor on May 8, 2023 for signature.  If signed by the Governor, the law takes effect 90 days after the end of the legislative session, August 7, 2023, unless a referendum is filed.  If a referendum is filed, then it will be on the November, 2024 ballot.

View the text of SB23-175

The law amends the downtown development authority authorization act to make reauthorization less cumbersome and allow downtown development authorities to continue facilitating development. Following an initial period of 30-years and the option for one 20-year extension of a tax increment financing (TIF) arrangement, the law would allow a downtown development authority the option for an additional 20-year extension. During the 20-year extension periods authorized in the law, the default split of the incremental revenues under current law is continued unless the municipality and all of the other governmental entities reach an alternative agreement.

The law was sent to the Governor on May 4, 2023 for signature. If signed by the Governor, the law takes effect 90 days after the end of the legislative session, August 7, 2023, unless a referendum is filed. If a referendum is filed, then it will be on the November, 2024 ballot.

The law amends the regulations and restriction on local government providing or operating a facility to provide cable television, telecommunications, or advanced service to subscribers unless the local government obtains voter approval for the local government’s provision of such services. The law:

  • Replaces the term “advanced service” with “broadband internet service”, which, as currently defined, does not reference the speed at which internet services are provided;
  • Eliminates the requirement that a local government hold an election before providing or before operating a facility to provide cable television, telecommunications, or broadband internet services to subscribers;

  • Eliminates the requirement that a local government hold an election to enter into a private partnership to allow a private provider to use local government facilities in connection with the private provider offering cable television service, telecommunications service, broadband internet service, or middle mile infrastructure.

  • Specifies that a local government may provide middle mile infrastructure, which is broadband infrastructure that does not connect directly to an end-user location;

  • Modifies the definition of “broadband internet service” as currently defined in the law concerning intrastate telecommunications services.

The law was signed by the Governor on May 1, 2023, and takes effect immediately.

View the text of SB23-286

The law makes various changes to the “Colorado Open Records Act” (CORA).

      •   Public records open to inspection. The law prohibits, with certain specified exceptions, a custodian of public records from requiring a requester to provide any form of identification to request or inspect records pursuant to CORA.

      •   Format of records for inspection. The law repeals requirements regarding records that are available in a sortable format and specifies that if a record is available in digital format, the custodian is required to transmit the record in a digital format by electronic communication or by another mutually-agreed upon transmission method if the size of the record prevents transmission by electronic communication. In addition, the law prohibits a custodian from converting a digital record into a non-searchable or non-sortable format prior to transmission.

      •   Records subject to inspection. The law adds to the category of records that a custodian can deny a right to inspect based on such disclosure being contrary to public interest the telephone number or home address that a person provides to an elected official, agency, institution, or political subdivision of the state for the purpose of future communication with the elected official, agency, institution, or political subdivision of the state.

      •   The law specifies that records of sexual harassment complaints made against an elected official and the results or report of investigations regarding alleged sexual harassment by an elected official conducted by or for that official’s government shall be made available for inspection if the investigation concludes that the elected official is culpable for any act of sexual harassment. The law specifies that the identity of any accuser, accused who is not an elected official, victim, or witness and any other information that would identify any such person must be redacted.

      •   Electronic mail policy. The law requires each member of the general assembly, the governor’s office, each office of the governor, and each state agency and institution to submit, on or before January 1, 2024, a report to the staff of the legislative council of the general assembly outlining its respective electronic mail retention policy.

      •   Transmission and per-page fees for records. The law specifies that the custodian may not charge a per-page fee if records are provided in a digital or electronic format.

      •   Electronic payments. The law requires a custodian to allow records requesters to pay any fee or deposit associated with the request via a credit card or electronic payment if the custodian allows members of the public to pay for any other product or service provided by the custodian with a credit card or electronic payment.

The law was signed by the Governor on June 6, 2023, and takes effect 90 days after the end of the legislative session, August 7, 2023, unless a referendum is filed. If a referendum is filed, then it will be on the November 2024 ballot.

View the text of SB32-303

The law concerns a reduction in property taxes by several methods:

1. The law creates limits on annual property tax increases from the prior property tax year for certain local governments, including special districts, at inflation levels unless the local government takes specified actions to exceed the limitations.

 

2. The law temporarily reduces the valuation for assessment of certain residential and nonresidential property.

Nonresidential Property:

For lodging property, property listed under any improved commercial subclass code, and all other nonresidential property, excluding agricultural property and renewable energy production property, the assessment rate is reduced as follows:

      •   27.9% to 27.85% for 2023 property tax year;
      •   27.85% for the 2024 through 2026 property tax years;
      •   27.65% for the 2027 and 2028 property tax years;
      •   26.9% for the 2029 and 2030 property tax years; and
      •   25.9% or 26.9% for the 2031 and 2032 property tax years, depending on the increase in the valuation in the 32 counties with the smallest increases from the 2030 to 2031 property tax years (revenue increases).

For agricultural property, excluding renewable energy agricultural land, and renewable energy property, the assessment rate is reduced as follows:

      •   29% to 26.4% for the 2025 through 2030 property tax years; and
      •   25.9% or 26.4% for the 2031 and 2032 property tax years, depending on the increase in the valuation in the 32 counties with the smallest revenue increases.

For renewable energy agricultural land, which is a newly created subclass of agricultural property, the assessment rate is reduced from 29% to 21.9% for the 2024 through 2032 property tax years.

Beginning with the 2033 property tax year, all temporary valuation reductions expire and the valuation of all nonresidential real property is 29% of the actual value of the property.

Residential Property:

The law further reduces the valuation of residential real property as follows:

      •   For the 2023 property tax year: the valuation is reduced from 6.765% of the amount equal to the actual value minus the lesser of $15,000 or the amount that causes the valuation to be $1,000 (alternate amount) to 6.7% of the amount equal to the actual value minus the lesser of $40,000 or the alternate amount.

      •   For the 2024 property tax year: the valuation is reduced as follows:
                •   For multi-family residential real property, the valuation is reduced from 6.8% of the actual value to 6.7% of the amount equal to the actual value minus the lesser of $40,000 or the alternate amount; and
                •   For all other residential real property, the valuation is reduced from an estimate of 6.98% of the actual value to 6.7% of the amount equal to the actual value minus the lesser of $40,000 or the alternate amount.

      •   For the 2025 through 2032 property tax years:
                •   For multi-family residential real property and primary residence real property, including multi-family primary residence real property, the valuation is reduced from 7.15% of the actual value to 6.7% of the actual value minus the lesser of $40,000 or the alternate amount;
                •   For qualified-senior primary residence real property, including multi-family qualified-senior primary residence real property, the valuation is reduced from 7.15% of the actual value to 6.7% of the amount equal to the actual value minus $140,000 or the alternate amount; and
                •   For all other residential real property, the assessment rate is reduced from 7.15% to 6.7 %.

Beginning with the 2033 property tax year, all of the temporary valuation reductions expire and the valuation of all residential real property is 7.15% of the actual value of the property.

The law also establishes that all temporary reductions in valuation for residential and nonresidential property created in the law are contingent on the State’s ability to retain and spend state surplus up to the proposition HH cap. If, for any reason, excluding a legislative enactment by the general assembly, the State is not permitted to retain and spend this money, then the temporary reductions in the law do not apply.

3. Creates new subclasses of residential property;

4. Permits the State to retain and spend revenue up to the proposition cap;

5. Requires the retained revenue to be used to reimburse certain local governments for lost property tax revenue and to be deposited in the State education fund to backfill the reduction in school district property tax revenue;

6. Transfers general fund money to the State public school fund and to a cash fund to also be used for the reimbursements;

7. Eliminates the cap on the amount of excess State revenues that may be used for the reimbursements for the 2023 property tax year; and

8. Refers a ballot issue to the voters at the November 2023 election that asks voters whether property taxes should be reduced and that seeks voter approval to retain and spend excess state revenues that will be used to backfill some of the reduced property tax revenue.

The law was signed by the Governor on May 24, 2023, and except as noted in the law, the majority of the law will take effect only if a majority of voters approve the ballot issued referred to in November 2023.

Community Association Legislation

View the text of HB23-1105

The law creates the HOA homeowners’ rights task force (HOA task force) and the metropolitan district homeowners’ rights task force (metro district task force) in the division of housing (division) in the department of local affairs.

Members of the HOA task force must be designated or appointed on or before August 1, 2023. The HOA task force is required to:

      •   Study issues confronting HOA homeowners’ rights, including homeowners’ associations’ fining authority and practices, foreclosure practices, communications with homeowners and the availability and method of making certain documents available to HOA homeowners in the association;

      •   Review HOA homeowners’ complaints and relevant state and federal laws related to common interest communities;

      •   Prepare an interim report regarding its findings and conclusions, publish the interim report on the division’s website, and submit copies of the report to the metro district task force on or before October 15, 2023; and

      •   Prepare a final report, publish the final report on the division’s website, and submit copies of the final report to the metro district task force, the legislative committees with oversight of housing and local government issues (legislative committees), and the governor on or before April 15, 2024.

The law was sent to the Governor on May 17, 2023 for signature.  If signed by the Governor, the law takes effect immediately.  If not signed by the Governor, the law takes effect 30 days after the end of the legislative session.

See above for description of metropolitan district task force specific details.

 

View the text of HB23-1233

The law requires the state electrical board to adopt rules facilitating electric vehicle charging at multifamily buildings, limiting the ability of the state electrical board to prohibit the installation of electric vehicle charging stations, forbidding private prohibitions on electric vehicle charging and parking, requiring local governments to count certain spaces served by an electric vehicle charging station for minimum parking requirements, forbidding local governments from prohibiting the installation of electric vehicle charging stations, exempting electric vehicle chargers from business personal property tax, and authorizing electric vehicle charging systems along highway rights-of-way.

The law was sent to the Governor on May 17, 2023 for signature.  If signed by the Governor, the law takes effect immediately.  If not signed by the Governor, the law takes effect 30 days after the end of the legislative session.

View the text of SB23-178

Under current law, a unit owners’ association (association) of a common interest community may not prohibit the use of xeriscape, nonvegetative turf grass, or drought-tolerant vegetative landscapes to provide ground covering to property for which a unit owner is responsible. There is, however, an exception authorizing an association to adopt and enforce design or aesthetic guidelines or rules that apply to nonvegetative turf grass and drought-tolerant vegetative landscapes or to regulate the type, number, and placement of drought-tolerant plantings and hardscapes that may be installed on a unit owner’s property, on a limited common element, or on other property for which the unit owner is responsible.

The law states that an association’s guidelines or rules must:

      •   Not prohibit the use of nonvegetative turf grass in the backyard of a unit owner’s property;
      •   Not unreasonably require the use of hardscape on more than 20% of the landscaping area of a unit owner’s property;
      •   Allow a unit owner an option that consists of at least 80% drought-tolerant plantings; and
      •   Not prohibit vegetable gardens in the front, back, or side yard of a unit owner’s property.

The law also requires an association to permit the installation of at least 3 garden designs that are preapproved by the association for installation in front yards within the common interest community. To be preapproved, a garden design must adhere to the principles of water-wise landscaping or be part of a water conservation program operated by a local water provider.

The law allows a unit owner who is affected by an association’s violation of the new requirements to bring a civil action to restrain further violation and to recover up to a maximum of $500 or the unit owner’s actual damages, whichever is greater. The law states that the new provisions apply only to a unit that is a single-family detached home and do not apply to:

      •   A unit that is a single-family attached home that shares one or more walls with another unit; or
      •   A condominium.

The law was signed by the Governor on May 17, 2023 and takes effect 90 days after the end of the legislative session, August 7, 2023, unless a referendum is filed.  If a referendum is filed, then it will be on the November 2024 ballot.